through which malaria impacts on economic growth is not clearly understood
or measured but probably revolves around the impact of repeated infections
(morbidity) on school and labour force participation (rather than mortality),
the costs to a household for treating repeated infections, the long-term impact
of cognitive development of children exposed to infection in the early months
of life, chronic anaemia, and an impact on tourism and FDI. The malarial link
is likely to decline owing to the recent successes in reducing the mortality and
morbidity associated with the disease (see Chapter 5 on the development of a
malaria vaccine).
Some (more micro-) studies quantify the causal link between health and
growth through school attendance and the productivity of classroom learning
and so ultimately through the more efficient formation of human capital. A
2003 study in Sri Lanka shows that better childhood nutritional status has a
positive and statistically significant impact on school test scores, and that chil-
dren with hearing problems and illnesses that cause them to miss school
perform significantly worse in tests (Wisniewski, 2010). An experimental
study found that children in schools where pupils were given de-worming
treatments had higher attendance and also that higher attendance was noted for
untreated children within the treated schools. This latter result suggested a
‘school attendance positive spillover effect’ from treated to untreated children
(Kremer and Miguel,1999).
Health policy
Significant market failures in health care are: the public goods nature of many
public health measures; externalities in medical care; the failure of demand
and supply to work as in other markets; and the systematic breakdown of
health insurance.
Population-based public health interventions include addressing communi-
cable disease,large-scale vector control (such as spraying against mosquitos),
provision of large-scale sanitation facilities, collection and analysis of data and
mass media campaigns. These are near-perfect examples of public goods. It is
not possible to quantify individual benefits of public goods and charge a
market price for them, as even those not participating will benefit from the
reduced incidence of disease. The difficulty in charging for public goods
means they are likely to be under-supplied in a free market. The public good of
communicable disease control also has equity implications as poor people
suffer from such illnesses more than rich people.
Another market failure in health is that of externalities. ‘An externality
occurs whenever the activities of one economic agent affect the activities of
another agent in ways that are not reflected in market transactions’ (Nicholson,
1995:802). If one person is vaccinated or if one country promotes a national
programme,beneficiaries will be other individuals or neighbouring countries
whose risk of exposure to the disease will be reduced. Private individuals will
not account for the external benefits of their decisions so a market is unlikely
134 Sources of Growth in the Modern World Economy since 1950